Purchasing a home (particularly for the first time) can be an incredibly exciting (and somewhat scary) experience. An essential aspect of buyer’s due diligence when purchasing a home is to ensure that the home is compliant with the local ordinances and municipal code(s). It is not uncommon that a seller often makes repairs or improvements to their homes without obtaining the necessary permits or checking if they need a permit when completing repairs or improvements to their home. It is imperative that when considering purchasing a home that as a buyer, you (or your attorney) ensure that the property disclosures reflect that there are no ordinance violations. Any violations that predate your ownership of the property (and citations or fines related thereto) are the responsibility of the previous owner and you as the new owner should not be held responsible for a previous owner’s omissions.
However, even where a property disclosure states that the seller is not aware of any ordinance violations; it does not mean that one may not exist. It is imperative that as the buyer, you and your attorney ensure that you contact the county and/or local municipality to ensure that the property is code compliant.
Thus, the question becomes, what do you do as a buyer when you apply for permits to complete work on your new home and learn that there are old permit violations that exist against your property. First and foremost, you need to contact your real estate attorney and discuss the circumstances with them. Second, you need to inquire of your attorney if he/she can assist you in attending the hearing for the violation and working toward a resolution. The reason that you need to ask your attorney of their ability to do this is that some real estate attorneys do not handle court proceedings and you need to ensure that your attorney can act on your behalf to assist you in clearing up the alleged compliance issue.
Second, your attorney needs to contact the seller’s attorney and inform them of the circumstances to determine if the violation was cited during the seller’s ownership of the property. Presuming that such is the case, then the attorney will need to work with the seller’s attorney and have the seller pay the necessary fines and costs to correct the alleged violation so that the property is code compliant with the local municipality. However, what recourse does the buyer have if the seller refuses? The seller’s attorney may claim that the seller has no idea what is going on (even when documentation is produced showing the violation during seller’s ownership of the property), so then what recourse is available to a buyer?
Your attorney will appear before either the court (or an administrative panel or Administrative Law Judge) to explain what transpired and how you are planning on rectifying the violation. The issue with ordinance violations in some municipalities and counties is that there is a daily fee that accrues for each day that the violation continues to exist against the property, which can result in an incredibly large fine depending on the duration that the violation has been pending. However, you as a buyer do have recourse against the previous owner, and while nothing is a guarantee, there are remedies available.
If the initial violation is being heard by a traditional judge, you can file a motion to have the previous owner included as a third-party defendant. As noted above, the violation was cited during their ownership of the property, and any expense that you have to pay as the new owner should be borne by the previous owner since the violation was not your doing.
However, if your case is before an administrative law judge or local municipality governing board; the steps varying from municipality to municipality but the general concept is similar. Your attorney will need to present the relevant information to the village attorney or official that oversees the violations and then a determination will need to be made as to whether to send the matter to a local court and proceed with the steps outlined above or to bring in the previous owner before the administrative board and have them explain the violation and effectively explain to the administrative panel why the violation was never corrected and have the expenses levied against the previous owner.
Every state, county, and the municipality has its own unique set of rules and procedures when the issue of an ordinance violation arises. Always understand that you need to consult with your attorney to best guide you through the proper steps for your particular jurisdiction.